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you know when we switch to a four day work week the productivity was the same or even better and when they looked more
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closely they found that or perhaps people spend less time on less efficient and less effective workplace practices
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in particular they highlighted that all the meetings were not so productive anyway and they actually spend less time
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in meetings welcome to the ripple effect the podcast that takes you on a journey through the
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minds of Wharton faculty I'm your host Dan Loney and in each episode we'll be
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diving deep into the inspiration behind the groundbreaking research that Wharton
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professors have conducted and exploring how their findings resonate with the world today and great to be joined by
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Yvonne Baron Kay who's associate professor of management here at the Wharton School Yvonne pleasure to talk
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to you again Dan so nice to see you thank you and so the the idea of the four day work week I guess after
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everything we've gone through during the pandemic and the kind of the success
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that people have had in terms of working remotely and all the different changes should we be surprised that we're
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starting to see more and more ideas like this come into the mix in terms of when
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we think about what work is going to look like no I think it's uh very interesting that
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um because employees have gained a little bit more bargaining power because the labor market was very favorable for
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employees employers had a often a hard time finding and retaining their employees
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because they were switching jobs so that gave them a bit more leverage and that perhaps has brought up a couple more
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ideas on how to accommodate the needs of employees in terms of work-life balance
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in terms of other obligations that they have and you know we will see ideas like this
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coming up up all the time and yeah the third day work week is an interesting one although it is it is something that
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has been around a little bit actually yeah yeah that's the unique thing is that this is not a New Concept
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historically there is a history there but it's realistically it's new in terms
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of what we think about work here in the United States yeah just just to provide a bit of historical context I mean the
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four day work week actually was tried at a large scale in Germany by Volkswagen after reunification and that was really
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in the cotton text of large restructurings of the economy because with reunification people discovered
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that most of the industry most of the capital in East Germany was not competitive so that led to massive
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restructuring and many of the western companies bought their counterparts in East Germany and then they faced the
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situation that they had to really rebuild how they are doing everything and in the past you might just say oh
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let's just fire people and then when we want to hire them again we can bring
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them back on board but that transition is is very very costly you know firing and then fining and training them again
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is very expensive so there they found uh the situation where they say well uh currently we don't have as much work so
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we cut the work back to four days um and in the German context it was almost at the same uh pay so it was uh
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it was that their pay did not shrink by 20 it shrank by a little bit but but but
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but not by 20 percent and but Volkswagen then went back to to the full week uh at some point yeah but
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the the idea of the four day work week now yeah is obviously it's a little bit
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different because the expectations are probably different for what would be what you would get from an employee yeah
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uh in part in part I think already if I may just put give one more historical uh
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experience from that um because um you know the workplace um is a funny is it funny it's the funny
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space because there's work that has to be done and companies uh think about what work they need to do and how many
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people they have that they need for that um but people who are in the workplace they of course are thinking about their
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career and careers are essentially tournaments and uh the way you get a promotion is to
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be good but also to be better than your peers and that led to a dynamic in the experience of the four day work week how
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many people actually took work home because they not only just wanted to get their work done but they wanted to excel
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they they were like contractually obligated to leave because these are you these were union jobs in the Volkswagen
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place and they did then they continued to work at home so that they you know could win in this tournament and that
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was something that led them to pressure among their peers to do the same so it was not just you Dan because you're well
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known overachiever you can't stop working right but then you know your peers at other
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um you know Executive Education or business school or radio stations will do the same so this then led to like a
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contagion effect across the the place and that led to a a view by many employees that this was actually quite
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more stressful because um The Experience the expectations of performance uh remain the same but they
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were not really adjusted to the fact that they had 20 percent less time to work and that put actually more pressure
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and more stress onto the employees so that was just like one historical experience I think is is relevant to
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bear in mind I think there have been now some new uh forests into this and there
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were like a couple of researchers who partnered with some companies and um they looked at the data and they seem to
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report that you know when we switched to a four day work week the productivity was the same or even better and when
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they looked more closely they found that or perhaps people spend less time on on
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less efficient and less effective um workplace practices and particularly they highlighted that oh the meetings
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were not so productive anyway and they actually spend less time in meetings now here I think it's worthwhile to
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reflect a little bit about what the modern workplace is like because it's not that you know you hire people to to
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uh to just like plug things together right and there's on an assembly line um because these jobs especially with
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GPT or perhaps those who will be replaced by by programs or by machines anyway so most of the jobs that require
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a human input and where value added is created are what we would call complex jobs or non-routine jobs
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and one particular type of job and here's a bit of a jargon here from computer science is called irreducible
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complexity so this is jobs these that are complicated and whenever there was there's a change in the circumstances
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you really have to think again about how to optimally spend your time so think about this for instance for you every
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day you have to think about how much time you want to spend on emails how much time you want to spend on meetings
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and talking to other people and how much time do you want to spend on in the studio right and in the end you want to
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figure out you know what makes you happiest and most productive but when I say there's a shock in the
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economy and because this time allocation job is a complex one whenever there's a
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change in circumstances this actually asks you to rethink how you spend your entire week and this is very very
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laborious to do that and this is why people in organizations on the outside they look it might look like it is not
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productive what they're doing when they're sitting around talking to each
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other but what happens in those circumstances is that they reflect on their work with their colleagues they
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learn from each other they learn uh from from them what they tried and what worked better in the current situation
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where they actually update their algorithm on how to spend their time and how hard to work on certain tasks so my
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concern here is that this is a bit of a simplified view of what the workplace really looks like when we say oh just be
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effective and you know just get your crank your workout and you know get it done and then you can go home and then
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you can spend time with your children learn another language and start a charity or whatever people are doing in
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this spare time I don't think that's really the the correct view of what a
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value creation job looks like so that's that's the balance that I'm thinking
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here it and as you were saying that one of the other things that came to my mind
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as well is the perception of what the employee has for what they think is the right mix in terms of duties and
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responsibilities in comparison to what the middle manager or the c-suite believes is the proper level and how
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those two may very well could could Clash at times absolutely absolutely and uh you know
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when I thought about this this this new interest and the four day work week and what it does to the workplace and you
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know spending your time more efficiently I I have to think about uh my marriage or everybody's marriage where you know
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there's one thing where you agree on what to do and then you you do it you know
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um I don't know my wife works on on the on our taxes and I perhaps fix dinner
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and what not and this is this is very good separation of tasks but on the other hand there are also these moments
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where we just like casually sit together and think about what we want to do and how we want to spend our time on and
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this is where we actually come to an understanding and this is really essential if you take away this time
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where people can reflect and discuss what are the important routines and where people can express their different
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Visions about what the work needs to be done when we take this away this just leads to a Schism in the workplace where
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there's just like uh the employers who pass on orders to their employees to execute them which in the end takes away
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a lot of the meaning and just job satisfaction and where people are just disgruntled and don't want to work in
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the workplace and that is not good for productivity are not good for Innovation so I think we have to be really careful
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that um we we have to create a space where people can continuously improve and realign their Visions in the workplace
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and when we squeeze them for time like this um I I fear that this might be at a loss
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both for the employees but also for the companies then what is the do you have kind of a
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formula then do you think of what it would take to make a four day week work on all of
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these different fronts because I think that's the challenge that you know to to
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get the best of both sides here yes yes so I think uh what we should not do and what I try to convey is we should not
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take away the time and space where people can hang out where people can exchange ideas and learn from each other
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in the workplace and align their Vision with the different layers in the hierarchy that is important I think
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moving to four day workweed should not mean that we take away meaning time a meeting time and where people are just
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there and implement the work I think that is the that is the concern I I have here so I think what we need to Simply
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do if people say I can or only want to work four days a week and the companies are happy with that then basically we
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need to shrink all components of this um I have a worry that you know if we do this then this might lead some companies
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to um actually do away with all these people who want to work four days a week so here again going back to Germany
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afterwards um there was a a very senior politician who actually took over one of
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the few competitive companies in East Germany which is size econ you know the lenses and Optical measurement
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instruments which was like very competitive then and then we when he thought when people asked him about the
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four day work week he said that you know I don't know maybe the Futures that
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people are just working on Tuesdays right is that is that what we're going forward obviously not so my concern is
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that when people are shrinking down the jobs in a compartmentalized way that can
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be done four-day work week they might just as well subcontract them because people who only show up for part
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of the week they're much less integrated in the workplace much harder to manage
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um and you know much harder to supervise if they're not there a lot so this is a
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slippery slope and I think not what companies and employees actually want well and and playing off of something
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you said a moment ago we're also at a time right now coming out of the pandemic where uh work from home remote
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work is it has grown for a lot of people you also have more and more focus on things like benefits and while those are
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great for a lot of the employees kind of off of what you said the potential is that it could have a negative impact
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because you have the options of chat GPT and other words to be able to get rid of
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employees and not have them working a four day week where some of these would be benefits for them
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yeah I think this is the the big discussion now I mean we want to create a workplace where benefits are better
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this is really having better benefits is very very instrumental for large sections of the of the population
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especially those who uh you know have a weaker social environment you know think
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for instance of single mothers they they really heavily depend on these benefits
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to actually be able to participant labor force so it's it's very proactive to
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have these benefits around and there are lots of studies that show that these benefits are conducive in the long run
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for better productivity um so but on the other hand when companies see this they might say SSA
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just we don't hire them and then we just subcontract them but again the My worry is that if you
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subcontract something it is not the same as having an employee because these persons are not really integrated in the
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routines and the culture of the workplace and uh they they don't have a say of shaping the workplace in a most
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effective way and employees are at the Forefront of the work they know what uh what are the challenges at the at the
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front lines so this this feedback loop leads to better productivity and by with a subcontractor you don't have that at
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all so I I think people need to think about carefully what uh what they miss out on or what they lose where they
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move to a four day work week or when they are moving to subcontracting and I think you know before they work week is
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a intermediate step to just Outsourcing and subcontracting and not for uh better
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uh workplace environment and when we're talking about this realistically we're
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not talking about all jobs here we're talking about even within companies there are probably certain jobs that
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maybe would would fit in that category yeah and other jobs that would not and you could probably say that by business
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and by sector as well that there are some companies that could probably do it other companies that would not be able
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to do it yeah um I mean if you think about it when you say oh let's what are the jobs that wow
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would really work well uh for a four day work week you might say oh these are people jobs that are pretty routine uh
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where okay you and you just do the job but it's well defined what the tasks are
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it's well defined what the what has to be done um but it turns out I think many people
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who actually push for the four day work week are not those people these are the people who push for the further they
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work with are those who actually are quite competitive in the labor market they say oh you know I want to perhaps
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do other things perhaps they want to do another job on this side uh or or another career development on the side
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and those are people who actually have many of these non-routine tasks and they are not all that great to be translated
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to a four-day work week think about this if you are running a team and you have a big project with
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many team members and in addition to the complexity of the team you of the task you also have to keep track on who's
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there when you know when is the day five when they're away because it's not that
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it's Friday where they all go home it will be all over the place so this comes
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with a lot of coordination logistical problems for companies when they actually have to do these non-routine
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complicated tasks so this is the interesting thing where the people who push for it are actually not the ones
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who uh who would be the most uh most amidable to have these kinds of tasks and these kinds of job designs
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what do you think then is the potential like Downstream impact of this idea of the four-day work week kind of being
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implemented here potentially in the United States um you know I think it's first of all I think it's
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great that companies and organizations always explore new uh new ideas as I said we had experience in the past they
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were from a very very different context and sometimes ideas that were used in a different scenario can generate a very
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unintended benefits in a new scenario so I think it's fantastic to see this in
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the workplace in the US that companies are always exploring new ideas and I'm I
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look forward to see you know what what else we are going to learn and what we have learned so far makes me
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a little bit worried as I say you know what we've learned so far is that people
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are just cutting out unproductive meeting time uh that sounds of course very entertaining and resonates with a
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lot of people but that leads me to say well then perhaps you need to make the meetings better and on the other hand
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meetings are really important for Value creation and reorganization that have have to happen continuously
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so I think I look forward to what else we will learn as companies are exploring this uh among the magnet portfolios or
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other ideas that they have but if they are if it's the same as in Germany in
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1993 I think it will be a transitory idea it is a reflection of companies trying out things perhaps employees
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pushing for it but after a while they realize that this is just too complicated to coordinate keeping track
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of who is in the office when and people as well perhaps want the Simplicity of a
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nine-to-five job that they can depend on and there's something to be said about
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how we are kind of become entrenched in our in our patterns and our history here
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in the United States yeah and it's and it's quite a bit harder to be able to
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break from those patterns oh absolutely yeah and there you have like the binary situation where either people stay in a
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certain pattern or companies just immediately jump over to subcontracting and that is kind of the slippery slower
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I'm worried about both for the employees and the organizations to to move more
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into subcontracting Yvonne great to talk to you as always thanks very much for your Insight yeah this was very
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interesting thank you have a great time you too Yvonne Baron K associate professor of management here at the
00:19:04
Wharton School thank you for listening to the ripple effect we hope you found this episode
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informative and engaging don't forget to subscribe and leave us a review so that
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